2025-08-18 00:39

LAUNCESTON, Australia, Aug 18 (Reuters) - China's refiners lifted their processing rates in July, but strong crude oil imports and domestic output meant there was still a surplus of more than half a million barrels per day (bpd) available for storage. The volume of surplus crude in July fell to 530,000 bpd from 1.42 million bpd in June, according to calculations based on official data. Sign up here. Despite the decline in surplus oil, the key point is that refiners are still likely adding to stockpiles, which will allow them to trim imports should prices rise to levels they believe are not justified by market fundamentals. China does not disclose the volumes of crude flowing into or out of strategic and commercial stockpiles, but an estimate can be made by deducting the amount of oil processed from the total of crude available from imports and domestic output. Refiners processed 14.85 million bpd of crude in July, up 8.9% from the same month last year, but down 2% from June, although that month was the highest since September 2023. The utilisation rate rose to 71.84% in July, up 1.02 percentage points from June and 3.56 percentage points from July 2024, according to official data released on Aug. 15. China, the world's biggest crude importer, saw arrivals of 11.11 million bpd in July, while domestic production was 4.27 million bpd. This meant that a total of 15.38 million bpd was available to refiners, and subtracting the 14.85 million bpd that was processed leaves a surplus of 530,000 bpd. For the first seven months of the year China's surplus crude amounted to 980,000 bpd, the bulk of this being built up from March onwards as crude imports and domestic output rose at a faster rate than refinery processing. It is worth noting that not all of this surplus crude is likely to have been added to storage, with some being processed in plants not captured by the official data. But even allowing for gaps in the official data, it is clear that from March onwards China has been importing crude at a far higher rate than it needs to meet its domestic fuel requirements. CRUDE IMPORTS The question for the market is whether the recent strength in crude imports will persist or if they will decline in coming months as refiners use more of their stockpiled oil. The key is generally prices, with China's refiners showing a pattern of increasing imports when they deem prices to be reasonable, but cutting back when they believe they have risen too high, or too quickly. The increase in crude imports from March onwards coincided with a declining trend in prices, with global benchmark Brent crude falling from a high of $82.63 a barrel on January 15 to a four-year low of $58.50 on May 5. Since then the picture has been more volatile, with the brief conflict between Israel and Iran, later joined by the United States, sending Brent to a high of $81.40 a barrel on June 23, before prices slipped back to around $65.57 in early Asian trade on Monday. It's possible that the rising prices from the May low to the June high may see China trim imports for cargoes arriving in late August and early September, as this would be the time period in which they were arranged. The move by top exporter Saudi Arabia to increase its official selling prices for both August- and September-loading cargoes may also see China buy fewer cargoes. But if refinery processing rates continue to rise and Chinese refiners continue their recent trend of exporting more fuels such as diesel and gasoline, imports of crude may hold up in coming months. Enjoying this column? Check out Reuters Open Interest (ROI), your essential new source for global financial commentary. ROI delivers thought-provoking, data-driven analysis of everything from swap rates to soybeans. Markets are moving faster than ever. ROI can help you keep up. Follow ROI on LinkedIn , opens new tab and X , opens new tab. The views expressed here are those of the author, a columnist for Reuters. https://www.reuters.com/markets/commodities/china-still-storing-crude-oil-even-refinery-runs-rise-russell-2025-08-18/

2025-08-17 23:17

Nuclear's 2024 share in power mix at 31.7% vs 25.9% in 2019 Coal's share declines to 28.1% from 40.4% before pandemic Coal use down due to cheaper nuclear power, grid constraints Declining industrial power demand also capping LNG use SINGAPORE/SEOUL, August 18 (Reuters) - South Korea's nuclear power output is racing ahead of official targets due to fewer maintenance outages, a new plant coming online and reactors running at full tilt, helping to rein in generation costs and pushing down coal usage. Generation from nuclear plants grew 8.7% year-over-year in the six months through June - three times official plans for 2.9% annual growth - while coal-fired output plunged 16%, data from state-run utility Korea Electric Power Corp (KEPCO) showed. Sign up here. "The basic principle of generator operation in the power market is minimization of generation costs. Nuclear power generally has lower fuel costs than other generation sources such as coal and liquefied natural gas (LNG)," a Korea Power Exchange (KPX) spokesperson said in a statement to Reuters. "If nuclear and renewable facilities continue to be additionally expanded in the future, generation from gas and coal is likely to continue to decrease," the spokesperson said. A 29% annual decline in maintenance outage times and a 6% increase in installed nuclear capacity in the first half of 2025 also boosted output, KPX said. The 1.4 GW Shin Hanul #2 plant southeast of Seoul came online in April 2024. South Korea is Asia's No.2 nuclear power generator after China. It is ramping up nuclear generation as policy resistance to the technology is waning, with Japan restarting idled plants and new reactors beginning commercial operations in India. The country of 51 million people operates 26 nuclear reactors with 26.05 GW of capacity and is building four more, including two units totalling 2.8 GW expected online in 2026. Tighter safety checks and maintenance shutdowns after the 2011 Fukushima disaster in Japan curbed nuclear output in South Korea last decade, lifting coal and LNG use. However, nuclear output has risen 6.1% annually since power consumption stabilised in 2022, and President Lee Jae Myung, who took office in June, has pledged continued support. Nuclear's share of power generation rose to 31.7% in 2024 from 25.9% in 2019, KEPCO data showed, offsetting most of coal's decline to 28.1% from 40.4% across the same years. That helped South Korea cut its energy import costs, with overseas coal volumes falling 8% annually on average from 2022 levels, according to customs data, and the coal import bill falling 23% over that period to $15.4 billion last year. TRANSMISSION CONSTRAINTS The growth in nuclear power is crowding out coal-fired power on transmission lines in South Korea. "Plenty of coal plants are sitting idle not by choice, but because there's no spare capacity on the transmission lines to carry more power," said Seunghoon Yoo, professor in the energy department in the Seoul National University of Science and Technology. Transmission constraints have also capped renewables, which along with hydropower provide just over a tenth of annual power generation, compared with a global average of 30%, according to the Institute for Energy Economics and Financial Analysis (IEEFA , opens new tab). Power demand has mainly been driven by higher cooling requirements since 2022, KEPCO data showed, as industrial demand declines. Slow power demand growth has also discouraged operation of expensive gas-fired plants through the day despite the proximity of most of those facilities to Seoul. Gas is increasingly used to manage volatility, KPX said. "There has been an increasing pattern of gas plants operating during the morning peak hours, stopping around midday when demand is at its minimum, and restarting for the evening peak," the power exchange said. Electricity use by semiconductor manufacturers and data centres is rising but has not impacted fuel procurement, South Korea's energy ministry said. https://www.reuters.com/sustainability/boards-policy-regulation/south-koreas-nuclear-power-output-surges-coal-use-plunges-2025-08-17/

2025-08-17 23:14

Aug 18 (Reuters) - Australia's top fuel retailer Ampol (ALD.AX) , opens new tab posted a 23% fall in profit in the first half of 2025 on Monday, hit by a drop in refinery margins and operational and weather-related disruptions, but the result was better than feared. Planned maintenance shutdowns and production losses from a cyclone disrupted operations, while weak Singapore refining margins pressured profitability at its Queensland refinery. Sign up here. The refinery's underlying operating earnings shrank substantially to A$1.1 million ($716,210) from A$89.5 million a year ago, while earnings from its fuel and infrastructure division also nearly halved to A$118.3 million. As a result, the company's net profit after tax from continuing operations fell to A$180.2 million on a replacement-cost basis for the six months ended June 30, compared with A$233.7 million a year ago. That beat the Visible Alpha consensus estimate of A$165.6 million. Ampol declared an interim dividend of 40 Australian cents per share, lower than 60 Australian cents per share paid out a year ago. ($1 = 1.5361 Australian dollars) ($1 = 1.5359 Australian dollars) https://www.reuters.com/business/energy/australias-ampols-h1-profit-slumps-lower-volumes-refinery-margins-2025-08-17/

2025-08-17 23:07

LONDON, Aug 18 (Reuters) - Asking prices for newly advertised British houses and apartments fell in the four weeks to mid-August but the drop was less notable than in the previous two months and sales in July were their highest for the time of year since 2020, a survey showed. Property website Rightmove said on Monday prices for homes put on sale between July 13 and August 9 dropped by 1.3% from the previous four weeks, in line with the normal mid-summer fall in prices. Sign up here. Asking prices had shown unusually big declines for the time of year in the previous two four-week periods. In annual terms, prices were up by 0.3%, Rightmove said. Colleen Babcock, Rightmove's property expert, said sellers were competing more on price. The number of sales agreed in July was the highest for the month since 2020 when demand for bigger homes was unleashed by the COVID-19 pandemic and government tax breaks. However, the number of available homes for sale again grew by more than the increase in sales during July, keeping the volume of homes for sale at a decade high. A third of homes on sale were cut in price while on the market, the second-highest proportion for the time of year in data going back to 2012. Babcock said this month's interest rate cut by the Bank of England - its fifth since August 2024 - was unlikely to push down mortgage costs much further but could encourage buyers. Two-year fixed-rate mortgage rates have fallen to 4.49% from 5.17% a year ago. Last week, the Royal Institution of Chartered Surveyors said Britain's housing market recovery lost steam at the fastest pace in a year in July and some buyers were worried about possible tax increases in finance minister Rachel Reeves' next budget. https://www.reuters.com/world/uk/asking-prices-uk-homes-drop-july-sales-hit-5-year-high-rightmove-says-2025-08-17/

2025-08-17 18:03

VILLARDEVÓS, Aug 17 (Reuters) - Scorching heat hampered efforts to contain 20 major wildfires across Spain on Sunday, prompting the government to deploy an additional 500 troops from the military emergency unit to support firefighting operations. In the northwestern region of Galicia, several fires have converged to form a large blaze, forcing the closure of highways and rail services to the region. Sign up here. Southern Europe is experiencing one of its worst wildfire seasons in two decades, with Spain among the hardest-hit countries. In the past week alone, fires there have claimed three lives and burned more than 115,000 hectares, while neighbouring Portugal also battles widespread blazes. Temperatures are expected to reach up to 45 degrees Celsius (113 Fahrenheit) in some areas on Sunday, Spanish national weather agency AEMET said. "There are still some challenging days ahead and, unfortunately, the weather is not on our side," Prime Minister Pedro Sanchez told a news conference in Ourense, one of the most affected areas. He announced an increase in military reinforcements, bringing the total number of troops deployed across Spain to 1,900. Virginia Barcones, director general of emergency services, told Spanish public TV temperatures were expected to drop from Tuesday, but for now the weather conditions were "very adverse". "Today there are extremely high temperatures with an extreme risk of fires, which complicates the firefighting efforts," Barcones said. VILLAGERS RESORT TO BUCKETS In the village of Villardevos in Galicia, desperate neighbours have organised to fight the flames on their own with water buckets as the area was left without electricity to power water pumps. "The fireplanes come in from all sides, but they don't come here," Basilio Rodriguez, a resident, told Reuters on Saturday. Added Lorea Pascual, another local resident: "It's insurmountable, it couldn't be worse". Interior ministry data show 27 people have been arrested and 92 were under investigation for suspected arson since June. In neighbouring Portugal, wildfires have burnt some 155,000 hectares of vegetation so far this year, according to provisional data from the ICNF forestry protection institute - three times the average for this period between 2006 to 2024. About half of that area burned just in the past three days. Thousands of firefighters were battling eight large blazes in central and northern Portugal, the largest of them near Piodao, a scenic, mountainous area popular with tourists. Another blaze in Trancoso, further north, has now been raging for eight days. A smaller fire a few miles east claimed a local resident's life on Friday - the first this season. https://www.reuters.com/sustainability/climate-energy/spain-battles-20-major-wildfires-amid-scorching-heat-deploys-more-troops-2025-08-17/

2025-08-17 15:29

European leaders rush to support Ukraine in US talks Analysts link US-Russia ties to Arctic energy deals Oil and gas may enter "deep" bear market - BofA European defence spending to ramp up - Berenberg LONDON, Aug 17 (Reuters) - Defence stocks and energy markets are likely to be in focus this week, as European leaders rushed to back Ukraine in talks with U.S. President Donald Trump that may pressure Kyiv to accept a peace deal favouring Russia. Investors are watching for signs that the U.S. may move closer to Russia in a bid to exploit vast, untapped Arctic energy resources, in a major geopolitical shift that piles pressure on Europe to rapidly boost defence spending. Sign up here. Trump and Russian President Vladimir Putin ended their weekend summit in Alaska without securing a Ukraine ceasefire agreement, with the U.S. President then saying he now wanted a rapid peace deal that Kyiv should accept. Ukrainian President Volodymyr Zelenskiy is travelling to Washington on Monday for talks that leaders of nations including Germany, the UK and France will now join. "Trump seems inclined to reduce or even end US support for Ukraine. Putin got him interested in business deals," Berenberg Chief Economist Holger Schmieding said in a note to clients. "As a result, the US may lift its sanctions on Russia and invest in Russia instead," he added. "Europe will have to spend a lot more for its own defence." DEFENCE STOCK RALLY Investors have bet on that outcome since February 2022, driving a supercharged rally in European aerospace and defence stocks (.SXPARO) , opens new tab with gains of over 600% for Leonardo (LDOF.MI) , opens new tab and 1,500% for Germany's Rheinmetall (RHMG.DE) , opens new tab. The euro has rallied 13% against the dollar this year and traded at about $1.17 on Friday. Bank of America strategist Michael Hartnett highlighted the potential for U.S.-Russia Arctic drilling projects to exploit 15% of the world's undiscovered oil and 30% of the world's undiscovered natural gas, resulting in a deep energy bear market. Brent crude, which dropped more than 1% to near $66 a barrel, on Friday, was still priced for a Ukraine peace deal, Hartnett cautioned, while Trump wanted lower energy prices for U.S. consumers . Ukraine's government bonds - key mood indicators - rallied when news of the summit emerged earlier this month but have stalled at a still-distressed 55 cents per dollar. "I would think they will be a bit weaker following the recent strength as the mood seems to favour Russia following Friday's summit," Aegon Asset Management head of emerging market debt Jeff Grills said. https://www.reuters.com/business/energy/global-markets-face-shaky-week-ahead-us-pressure-mounts-ukraine-2025-08-17/